Higher primary surplus in 2023

Last year’s primary surplus in Greece proved significantly higher than the budget estimate for 1.1% of gross domestic product, reaching 1.9% of GDP and making it easier to meet this year’s target of 2.1% of GDP.

It was a positive signal in the international markets, as pointed out by the Ministry of National Economy and Finance, sources of which have been adding throughout the last period, however, that it does not constitute a reason for relaxation and that the country will continue on the path of fiscal stability.

According to the data by Eurostat in the context of the so-called Excessive Deficit Procedure, Greece also had the second best performance, after Portugal, in the EU in terms of reducing its public debt, although this remains the highest in the European Union. 

For the first time after many years, the debt was reduced in absolute terms, by 100 million euros. The public debt was 161.9% of GDP, higher than the estimate (in the 2024 budget) of 160.3% of GDP, as the growth rate was 2%, lower than the estimate of 2.4% and thus the denominator was lower. However, debt in absolute terms fell from €356.796 billion to €356.659 billion. On average public debt was 81.7% in the EU and 88.6% in the eurozone.

The fiscal outperformance of 2023, following the corresponding one of 2022, is largely the result of the outperformance of tax revenues, mainly corporate income tax. In 2023, the profits of 2022, a good year in terms of growth and business profits, due to the end of the pandemic, were taxed. 

The ministry maintains that the increased tax revenue is also a result of the reduction in tax evasion. It stated that “this positive result proves the dynamics of the Greek economy, but also the gradual benefits from the reduction of tax evasion. It is indicative that in the months of January and February 2024, €397 million out of the €647 million that was the exceeding of the objectives, came from the payment of corporate income tax.”

As a percentage of GDP, however, revenue fell in 2023 compared to 2022 from 50.63% to 48.95% of GDP.